New Model Trusts
![handle is hein.journals/kingsclj8 and id is 149 raw text is: Case Notes
that application, the issue of paternity would be settled. The Court made
a further direction for blood tests, to permit the petitioner, in a final effort,
to put his belief to the test. Waite L.J. acknowledged the petitioner's belief
that contact between him and the child was good for her, but correctly
stated that contact was best when it took place in light of the true factual
position, which only the tests could establish. Furthermore, if the
petitioner were proved not to be the father, he would be accepted as a
committed stepfather of a child of the family, and no injustice would be
done.
Although the Court of Appeal asserted the need to establish the truth
as to paternity to promote justice to the child, the case illustrates the
difficulty in accepting that it is in the child's best interests to know that
her putative father's refusal to submit to a blood test, in an effort toprotect
her, has resulted in his status changing to that of a devoted stepfather,
and to face the consequences of that finding. However, it should be of
some comfort to the petitioner that despite the Court's firm belief that he
should submit to the tests, the directions made were such that even if the
tests established he was not the natural father, he would still have contact
with the child as her stepfather. Although there is, in general, no
presumption that step-parent should continue to have contact with his/her
stepchild, Butler-Sloss L.J. in Re H (A Minor)(Contact) [1994] 2 F.L.R.
776 recognised that in a child's life, there are people who, although they
have no biological relationship with the child, can nevertheless be very
important to the child. The Court of Appeal in this case supported that
view. A small, but significant, consolation prize for the petitioner.
ANJANA BAL*
NEW MODEL TRUSTS
In 1991 the House of Lords decided that interest rate swap agreements
between banks and local authorities were ultra vires the local authorities,
thereby setting off a spate of litigation to recover sums which had been
wrongly paid over between parties to such agreements. Typically these
swaps involved the payment by a bank of a lump sum to a cash-starved
(i.e., rate-capped) council followed by periodic payments by the local
body to the bank over a contractually determined period. These periodic
payments were calculated according to the difference between the two
types of interest rates on which the bank and council had each chosen to
gamble. In Westdeutsche Landesbank Girozentrale v. Islington Borough
Council, [1996] A.C. 669, the bank made a lump sum payment of £2.5
million and took on the fixed interest rate payments, while Islington
Lecturer in Law, King's College London](ViewImageLocal?handle=hein.journals/kingsclj8&div=24&collection=&method=preview&ext=.png&size=3)
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